Google's 'evil' stock split

Remember when Google was a rebel? The company's stock split shows its transition to tech's dark side may be complete.

The opinions expressed in this commentary are solely those of Paul R. La Monica. Other than Time Warner, the parent of CNNMoney, Abbott Laboratories and AbbVie, La Monica does not own positions in any individual stocks.

But Google is about to issue new shares to existing investors which have absolutely no voting rights. Isn't that sorta evil?

If you owned Google (GOOG) as of March 27, you will wind up with twice as many shares at half the price when the markets open on April 3. The old Google Class A shares will trade under the new ticker symbol of GOOGL. That comes with the right to a vote at the annual shareholder meeting.

The new Class C Google shares will trade under the old ticker symbol of GOOG. They have no vote. So while the value of your investment will not change, your say over how Google runs the company will.

Why is Google doing this? To further consolidate power among the Google leadership triumvirate of CEO Larry Page, chairman Eric Schmidt and co-founder Sergey Brin.

Keep in mind those three already control more than 61% of the voting power for Google because they are the largest owners of Class B shares. Those shares are not listed publicly ... and they have 10 votes per share compared to one vote for the Class A shares.

Cue the Imperial Death March theme from the original Star Wars trilogy. (I'm pretending Episodes 1 through 3 don't exist.)

Even before this stock split, Google was viewed by some as the New York Yankees of tech stocks: the proverbial Evil Empire. This move is the equivalent of making the Death Star fully operational. (Watch out, Alderaan!)

As the company explained/spun when they first announced the proposal for the split nearly two years ago, the new share structure was "designed to preserve the corporate structure that has allowed Google to remain focused on the long term."

Translation: Nobody else really matters when it comes to decision making. We might as well be a private company.

Unsurprisingly, some shareholders were not pleased with the proposal. The fact that it has taken this long for the split to go into effect is because some shareholders sued to block it.

Google settled with that group last June. Google agreed to stricter board reviews of some acquisitions using company stock and also agreed to compensate shareholders if the new C shares begin to trade at a discount to the A shares with voting rights. And I think that is exactly what should and will happen. But more about that in a bit.

Google is not the only company to play this game. Many media firms, particularly family-run ones, also have two shares of stock. That's the case for Rupert Murdoch's News Corp. -- (NWS), (NWSA) -- and Twenty-First Century Fox -- (FOX), (FOXA). Ditto for Sumner Redstone's CBS -- (CBS), (CBSA) and Viacom -- (VIA), (VIAB).

And cable giant Comcast has three classes of shares like Google. Two trade publicly: (CMCSA) and (CMCSK). The shares with a symbol ending in A have a vote. The ones with the not-so-special K do not. Comcast's Class B shares are held by a company controlled by CEO Brian Roberts -- whose father, Ralph, founded Comcast.

So why am I making such a fuss of this? Google is supposed to be different than the rest of the tech sector. This is a firm that started as a plucky David going up against the Goliath of Microsoft (MSFT). Google now is worth more than Microsoft. It's no longer fighting "The Man." It is "The Man."

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The point of owning a stock is that you don't just profit from the company's success. You also have a say -- albeit small -- in how it is run. Google is throwing that out the window. Ironically, the company that owns YouTube is saying that "You" don't matter.

The notion that Google shareholders have any real rights is a Woody Allen-esque travesty of a mockery of a sham of a mockery of a travesty of two mockeries of a sham. The company wants you to blindly put its faith in Page, Brin and Schmidt and hope for the best.

To be fair, Google shareholders have been rewarded handsomely by that trio so far. Google's stock is up more than 40% in the past year and has surged 220% in the past five years.

And if you were lucky enough to own Google since it went public, you might want to name your sons (or daughters, I'm not judging) after Larry, Sergey or Eric. Google's stock is up an astonishing 1,235% from its IPO price of $85.

Still, isn't it reckless for an investor to throw caution completely to the wind and trust that Page, Brin and Schmidt will never make a mistake? The tech sector is full of companies that were once leaders who failed to adapt to changing times.

Luckily, Google has not made any notable blunders -- well, none that had a lasting impact on the stock. It is a forward-looking company that doesn't worry as much about what Wall Street and short-term oriented traders think about the company.

So while I wouldn't necessarily advise investors to drop Google -- it is, after all, a phenomenal company -- no investor in their right mind should ever buy the new class C shares.

In fact, if I were an existing Google investor, I'd sell the Class C shares I receive in order to buy more A shares. That way, my vote would still count as much in the future.

Paul R. La Monica is an assistant managing editor at CNNMoney. He is the author of the site's daily column, The Buzz, and also tweets throughout the day about the markets and economy @LaMonicaBuzz. La Monica also oversees the site's economic, markets and technology coverage.